New Requirements for Employers in California

Doing business in California has always been a daunting task for employers because of California’s onerous regulations for employers. Now that we are nearly two months into 2026, it is important to ensure you are complying with the most recent regulations.

• SB 294 – Effective February 1, 2026, California employers were required to provide a stand-alone written notice of workers’ rights to all employees both at hire and then annually thereafter. View the Labor Commissioner’s official “Know Your Rights” notice template here.
  • Importantly, one of the requirements from SB 294 takes effect March 30, 2026. By this date, employers must provide an opportunity for their employees to identify an emergency contact to be notified if the employee is arrested or detained at work. Employers must ensure the contact is notified if the employee is arrested or detained at the workplace or related to workplace activities.
• SB 513 – Any employer doing business in California is very familiar with personnel records requests as California has strict requirements for compliance with an employee’s request for his or her personnel records. SB 513 has expanded the types of records that must be provided in response to a request for personnel records. Employers must now provide documents related to education or training received by the employee. California employers who maintain education or training records must ensure these documents include specific details, such as the name of the employee, the name of the trainer, the duration and date of the training, core competencies covered by the training, and any resulting certifications or qualifications.
• AB 692 – This new law prohibits “stay or pay” clauses. It is now unlawful in California for employers to require employees to repay training costs, relocation expenses or other debts if the employee terminates employment before a specified time period. This law applies to any contracts entered into after January 1, 2026.
  • There are some very limited exceptions to this prohibition. For instance, repayment for tuition of a transferable credential is allowed provided the agreement is separate from the employment contract, specifies repayment amounts, prorates repayment, and does not require repayment in the case of involuntary termination unless the termination is for misconduct as defined in Unemployment Insurance Code Section 1256. Additionally, certain discretionary bonuses at the outset of employment, such as retention bonuses, that are not tied to specific job performance may be subject to repayment if the agreement meets strict conditions, but the agreement cannot require more than a two-year retention period. If you are considering a retention bonus for a California employee, you should consult with counsel to ensure you are complying with all of the new law’s requirements.